Lupatech Seeks to Postpone Interest Payment on Local Bonds

April 13 (Bloomberg) -- Lupatech SA, Brazil’s largest oil-services company, is seeking to postpone interest payments on
320 million reais ($174 million) of local bonds from state
development bank BNDES after profit fell and it lost contracts.

The company will ask bondholders to delay for 120 days
annual interest payment due April 15, according to an e-mailed
statement today from the company. Lupatech, based in Caxias do
Sul, Brazil, will also seek a waiver on bond debt covenants.

Lupatech needs to renegotiate terms on its bonds after
state-controlled oil producer Petroleo Brasileiro SA canceled
two contracts worth $779 million. Its top shareholders, led by
BNDES, signed an agreement to inject as much as 700 million
reais of fresh capital in the company through a share sale after
Lupatech posted five straight quarterly losses.

BNDES will approve Lupatech’s request, according to a
person familiar with the bank’s plans.

The company, led by Chief Executive Officer Alexandre
Monteiro, said the move “aims to avoid an unnecessary short
term commitment of cash, aligning the payments flow with the
company’s capitalization schedule,” according to the statement.

The oil-services provider’s order backlog was slashed by 60
percent to 935 million reais from 2.33 billion reais after
Petrobras canceled the contracts, Lupatech said April 2.

BNDES holds about 90 percent of the bonds, according to
information on Lupatech’s website. Lupatech has scheduled a
local bondholders’ meeting for April 30, it said in the
statement. BNDES, based in Rio de Janeiro, declined to comment.